Specific Tax Exemption on the Removal of Imported Gasoline and Fuel Oils Stored in Bonded Warehouses

February 7, 1958 BIR RULING NO. 087-58 3rd Indorsement Respectfully returned to the Honorable, the Secretary of Finance, Manila. Imported gasoline and fuel oils stored in bonded warehouses under the supervision of the Bureau of Customs can be removed therefrom and loaded into the tanks of airplanes belonging to foreign airline companies without payment of the specific tax, subject to the following conditions: cdti 1. That the gasoline and/or fuel oil shall be consumed outside of Philippine territory; 2. That the removal of the gasoline and/or fuel oil from the bonded warehouse, as well as the loading thereof into the tank of the airplane concerned, shall be under the supervision of a representative of the Bureau of Customs who shall submit to this Office a certificate containing the following: (a) the date of removal and loading of the gasoline and/or fuel oil; (b) the quantity thereof removed and loaded; (c) the serial number, or any identifying description, of the plane into which the gasoline and/or oil is loaded; (d) the quantity of gasoline and/or oil already found in the tank or tanks of the plane upon its arrival; and (e) the dates of arrival and departure of the plane; 3. That the supplier shall file, in behalf of the foreign airline company, a surety bond for an amount equivalent to the specific tax which may be due on the latter's average monthly consumption of gasoline and/or fuel oil. The bond, which must not contain an expiry date, shall state the fact that the gasoline and/or fuel oil consumed by the airline company and supplied by the gasoline company, may be withdrawn from the bonded warehouse and loaded into the tanks of the airplane without payment of the specific tax, subject to the conditions above prescribed which must be enumerated in the bond. Said bond shall also state that it shall guarantee payment of the specific tax due on the gasoline and/or fuel oil consumed in case the above conditions are not complied with and said tax is assessed against the airline company. On the other hand, where the specific tax due on the gasoline and/or fuel oil supplied to the airplanes of a foreign airline company had previously been paid, the same cannot be refunded anymore. In view of the foregoing, this Office is of the opinion that, if the case be that the gasoline and oil purchased by the Flying Tiger Line, Inc. from local suppliers thereof were taken from their respective stocks held under bond and that the aforementioned conditions had been complied with, said gasoline and oil are exempt from the specific tax due thereon; otherwise, neither the Flying Tiger Lines, Inc. nor its suppliers are entitled to a refund of the tax due and paid on the gasoline and oil in question. cdta It may be stated that the 50% exemption from the specific tax provided in the last paragraph of Section 142 of the National Internal Revenue Code, as last amended by Republic Act No. 755, of gasoline and other oils mentioned therein, if the same are used in aviation or agriculture, ceased to have force and effect after June 18, 1957, the date of expiry of said provision. (SGD.)JOSE ARAAS Commissioner of Internal Revenue